No matter what kind of business you’re in, understanding Intellectual Property is one of the most important steps in establishing your brand.  

When you think of McDonalds or Disney, you should have a very clear idea of what that brand is all about. They all have their own distinct story and character. Well, this is something that takes some time and effort to do, so businesses need to make sure that brand is protected. The last thing you want is someone else benefiting from your creative ideas. 

Trade marks are one of the key aspects of Intellectual Property – it differentiates your product or service from others, and is basically the face of your brand. This might take the form of a logo, slogan or even a scent. The main idea is that you own it, so you wouldn’t want anyone else taking it (this is similar but different to copyright – you can read more about the differences between the two here). 

This article will go through the implications of a trade mark infringement and how you can protect your brand

What Is A Trade Mark Infringement?

A Trade Mark Infringement is when another business tries to use an existing trade mark. As you might already know, businesses need to register their trademark with a government body called the Intellectual Property Office (IPO).

So, if your trade mark is registered, other people can’t use it. If they do, you’ll need to start looking at ways you can make a claim. 

How Do I Know If Someone Has Infringed My Trademark?

If you think someone is infringing your trade mark, your first step is to look at the Trade Marks Act 1994. For example, section 10(1) sets out that infringement arises where someone makes a mark that is identical to a registered trademark without any modification.

Generally speaking, a person may be taken to infringe a trade mark in the following circumstances:

  • Where someone uses an identical mark for goods and services
  • Where someone uses an identical mark for similar goods and services, creating confusion
  • Where the goods and services mark is not similar to the existing trade mark, but damages it nonetheless
Example: Clothing The Gap vs Gap
After a two year long fight, small business Clothing The Gap made the decision to rebrand to ‘Clothing The Gaps’ after receiving a cease-and-desist letter from US company The Gap. 

Even though The Gap was never something they considered when naming their store, co-founder Laura Thompson decided she did not want the fight to escalate. Rather, they focused on separate campaigns that were more involved in their overall goals as a business. 

Clothing The Gaps never intended for it to be connected to The Gap Inc, however they are both fashion brands using the same word in their name which may have been a significant factor in deciding that it amounted to a trade mark infringement. 

How Common Are They?

While it’s common to face trade mark disputes, actual legal proceedings are far less common. This is because people try to resolve the matter in the early stages (we’ll discuss these options shortly). 

Nonetheless, trade mark disputes are still quite common. This is because there are a lot of similar trademarks out there, and business owners are very quick to protect their brand from any threats. 

In addition, the circumstances listed in the Act can be interpreted quite broadly. For example, how would the Courts define ‘similar’?

Some real life examples can tell us exactly how it is decided that someone has infringed a trade mark. 

Example: Airbnb v Airtasker
In 2019, Airbnb commenced legal proceedings against Airtasker, alleging that the company was infringing their trademark. They argued that their brand is more well known, and the identical use of the word ‘air’ would cause some consumers to think that Airtasker is a service offered by Airbnb. 

While the companies offer different services, their names can be considered ‘substantially identical’. As such, customers are likely to be confused as to their connection. 

Up to now, Airtasker has chosen not to respond to these claims, however it poses a barrier to their proposed trade mark application in Europe. We have yet to see what Airtasker chooses to do during this dispute. 

Trade marks can get a little complex when placed in an international context – we’ve written more about this here

My Trade Mark Is Being Infringed – What Now?

Unfortunately, it’s quite common to come across an attempt to steal your creative ideas. In such a competitive market, it’s important to keep an eye out for these threats. 

So, let’s say someone has tried to register a trade mark that is identical to yours. What are your options?

The first thing you’d want to do is seek professional advice (from a lawyer, of course!). In fact, you’d need to do this as soon as possible – minimising delays will also work in your favour in relation to financial compensation. 

Once you start speaking with a lawyer, you will most likely be asked to send a Letter of Demand to the person allegedly infringing your trademark. This letter should cover things like:

  • Your rights in relation to your trade mark
  • Specific details of what the alleged infringer did (in other words, how they breached those rights)
  • Steps the alleged infringer should take to stop those breaches (for example, change their business name)
  • Outline what steps will be taken if the breaches continue (for example, state that you’ll resort to Alternative Dispute Resolution and potentially legal proceedings). 

The Letter of Demand is important as it will basically set out what will happen and what options the other party has, so it’s best to have a lawyer draft this for you. If the other party does not respond to your letter, you may need to turn to ADR. This just means you’ll need to go through a process of mediation with them, and if this still fails, you may need to take the dispute to court. 

Make Sure You Have Legal Grounds

With so many trade marks being registered, it’s very common for business owners to get personally attached to their brand and any threats to it. If you suspect that someone is infringing your trademark, it’s important to check that you actually have legal grounds to make a claim against them. You wouldn’t want to threaten someone with legal proceedings if it’s not actually likely that they’ve breached anything. 

In fact, the other party can actually sue you for making groundless claims or threats against them.

What If I Infringed Someone Else’s Trademark?

All business owners should be checking whether or not a trade mark already exists before they try to register their own. This way, you can ensure you’re not accidentally using someone else’s IP. Even if you don’t think you are, there may be cases where your trade mark will remind customers of another brand and this might amount to trade mark infringement (depending on the circumstances, of course). 

Your first step should be to conduct a search on the IPO website. Here, you can see whether the mark you’re hoping to register already exists. In this case, you should not register that trade mark or you could be liable for trademark infringement.

Receiving a Letter of Demand is not always the greatest news, and we know it can get emotional or upsetting. If you find yourself being accused of trade mark infringement, the first thing you should do is have a lawyer review the Letter of Demand you’ve received, otherwise you may end up agreeing to terms that you shouldn’t. 

At the end of the day, you also want to protect your business from groundless claims (if this is the case). 

What Are The Penalties For Trademark Infringement?

As with most other cases, you should try to avoid going to court. However, if the dispute isn’t going as smoothly as planned and you do land yourself in court, the court may provide relief according to section 14 of the Trade Marks Act.

Generally, the owner of the infringed trade mark decides what penalties they wish to impose.

So, what kind of penalties are we talking about?

Injunction

If the court orders an injunction, this just means that the infringer will need to cease their use of the trade mark or sign. The court can also impose additional conditions at their discretion. 

Damages

Depending on what the registered trade mark owner prefers, the court can grant that owner either damages or an account of profits. This just means the owner will receive financial compensation, or they’ll receive the profit that the infringer made from their breach. 

However, neither of these remedies will be provided if:

  • The infringer has sought to have their registered trade mark removed from the register
  • The court decides that the registered trademark was not used in good faith during the infringement claims

The court may also grant additional damages depending on a number of considerations, such as:

  • The infringer’s conduct 
  • How the infringer benefited from their breach
  • How future infringements can be deterred 

Keep in mind that each case will be handled differently by the court, so these penalties should be used as a general guide only. 

Next Steps

All business owners should be aware of the steps they can take to protect their trade marks, and how to respond if they’re being accused of trade mark infringement. 

Need help applying for a trade mark? Sprintlaw has a team of lawyers who are happy to help. You can reach out to us at [email protected] or contact us on 08081347754 for an obligation-free chat.

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